Callaway 2014 Annual Report Download - page 22

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6
• Facilities through the partnership with local utilities to implement energy reduction initiatives such as energy efficient
lighting, demand response energy management and heating, ventilation and air conditioning optimization;
• Manufacturing through lean initiatives and waste minimization;
• Product development through specification of environmentally preferred substances;
• Logistics improvements and packaging minimization; and
• Supply chain management through Social, Safety and Environmental Responsibility audits of suppliers.
The Company also has two existing programs focusing on the community, the Callaway Golf Company Foundation and
the Callaway Golf Company Employee Community Giving Program. Through these programs the Company and its employees
are able to give back to the community through monetary donations and by providing community services. Information on
both of these programs is available on the Company’s website www.callawaygolf.com. By being active and visible in the
community and by embracing the principles of environmental stewardship, the Company believes it is acting in an
environmentally and socially responsible manner.
Intellectual Property
The Company is the owner of approximately 3,000 U.S. and foreign trademark registrations and over 1,100 U.S. and
foreign patents relating to the Company’s products, product designs, manufacturing processes and research and development
concepts. Other patent and trademark applications are pending and await registration. In addition, the Company owns various
other protectable rights under copyright, trade dress and other statutory and common laws. The Company’s intellectual property
rights are very important to the Company and the Company seeks to protect such rights through the registration of trademarks
and utility and design patents, the maintenance of trade secrets and the creation of trade dress. When necessary and appropriate,
the Company enforces its rights through litigation. Information regarding current litigation matters in connection with
intellectual property is contained in Note 13 “Commitments & Contingencies—Legal Matters” in the Notes to Consolidated
Financial Statements in this Form 10-K.
The Company’s patents are generally in effect for up to 20 years from the date of the filing of the patent application.
The Company’s trademarks are generally valid as long as they are in use and their registrations are properly maintained and
have not been found to become generic. For certain risks associated with intellectual property, see “Risk Factors” contained
in Item 1A.
Licensing
The Company, in exchange for a royalty fee, licenses its trademarks and service marks to third parties for use on products
such as golf apparel and footwear, golf gloves, umbrellas, prescription eyewear and practice aids. With respect to its line of
golf apparel, the Company has current licensing arrangements with Perry Ellis International for a complete line of men’s and
women’s apparel for distribution in certain retail channels in the United States, Canada, Latin America, Europe, Middle East
and Africa, and Sanei International Co., Ltd. for a complete line of men’s and women’s apparel for distribution in Asia and
Asia Pacific countries. With respect to the footwear lines, the Company has a licensing arrangement with AMG-SF, LLC for
a complete line of men’s and women’s golf footwear for distribution in certain retail channels in the United States and Canada.
In addition, the Company has also licensed its trademarks to, among others, (i) IZZO Golf for practice aids, (ii) SM
Global, LLC for golf gloves sold exclusively to Costco Wholesale Corp., (iii) ShedRain Corporation for umbrellas sold
exclusively to Costco Wholesale Corp. and iv) Walman Optical for a line of prescription Callaway eyewear.
Employees
As of December 31, 2014 and 2013, the Company and its subsidiaries had approximately 1,700 full-time and part-time
employees. The Company employs temporary manufacturing workers as needed based on labor demands that fluctuate with
the Company's seasonality.
The Company’s golf ball manufacturing employees in Chicopee, Massachusetts are unionized and are covered under a
collective bargaining agreement, which expires on September 30, 2017. In addition, certain of the Company’s production
employees in Australia and Mexico are also unionized. The Company considers its employee relations to be good.